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  • Writer's pictureTenaya Insurance Services

How COVID-19 is Changing the Financial Conversations in Families

COVID-19 has changed our day to day lives in a major way. Travel plans have been cancelled. Parents have become home school teachers (insert new appreciation for teachers here!) Family get togethers have turned virtual. Toilet paper has become the elusive unicorn for a time (who would have thought), not to mention a slew of other changes to our daily routines.

When a global pandemic comes on unexpectedly it's an unwanted wake-up call. A realization that life as we know it can change in an instant. Were we prepared for it? Did we have some money set aside to get us through it? Did we have an emergency food supply? Did we put steps in place to protect our family's financial future? Or did it show us that we need to do better? Most people fall in the second category.

But this wake-up call is the silver lining in this pandemic. The realization that we need to re-evaluate the steps we're taking now to make sure that going forward we don't find ourselves in this position again. And it's triggered some long-overdue conversations about finances in our families, and that's a great thing.

What's Being Talked About

According to a Life Happens survey that was recently conducted polling more than 2,000 Americans about how the pandemic has changed their financial views and behaviors, here's the topics that respondents said has been coming up when they have these conversations:

  • Current health issues and concerns (32%)

  • Life insurance coverage (30%)

  • Wills and inheritance (33%)

  • Current financial status (29%)

  • Politics (25%)

  • Emergency savings (27%)

  • Future emergency plans (26%)

Changing Financial Habits

Aside from these conversations, families have also changed the way they manage their finances since COVID-19. These changes include:

  • Building up emergency and savings funds (45%)

  • Cutting excessive spending (49%)

  • Focusing on paying down debts (24%)

  • Delaying retirement & continuing to work (43%)

  • Dipping into retirement savings (37%)

Pushing Past the Discomfort

Even with these conversations starting to happen more, the topic of finances has been an uncomfortable one within families for generations. But they are essential to have. Nearly 69% said they want to be even more open with their partners about their finances, 60% also said they want to spare their kids, but avoid discussing money with children because they don't want their kids to worry. We need to change this, because it's the absence of these conversations that actually does a huge disservice to our family members. We are actually putting them in a worse position by not planning ahead, and teaching them how important this type of planning is.

I remember as a teenager, my dad telling my siblings and I that my parents were buying a long term care policy so that care for him and my mom would be paid for if needed. I naively said, as a teenager does, that I didn't know why he was buying it. He had four kids who could pay for that if it was needed. He told me it wasn't our responsibility to pay for it, and this way we wouldn't have to worry about it. Clearly I had no idea how expensive long term care was. Fast forward to today, I have "life experience" under my belt, and long term care insurance is something that I provide for clients. Why? Because the national average cost for one year in a semi-private room in a nursing home is $ 90,155! For one year! What kind of dent would that put in your retirement savings? And if you need care for more than one year (and most people do), this number just goes up from there. What if you couldn't afford it? Are you going to ask your kids to cover the cost? Could they afford to?

An Example Set

I was blessed to have parents who lead by example, and had the conversations with us. They planned for all of life's "what if's". They had a will and trust set up, and kept it updated. They had life insurance in place. They had long term care insurance in place. They made sure their kids knew where this information was, just in case. And I got an un-welcomed reminder of how important these things are when my dad passed away unexpectedly three years ago at age 67. I saw how amazingly all of this planning had taken care of my mom, as well as us four kids. How much easier it made everything while we were dealing with our grief. Unfortunately I've also seen how failing to do what my parents did has affected other families. They pay a much, much higher price when nothing is done because the conversation was uncomfortable.

There's No Better Time Than Now to Consider Life Insurance

66% of respondents believe COVID-19 has helped them better understand life insurance. 25% have bought life insurance for the first time because of it. COVID-19 has reminded us of our own mortality. Even if you're young and healthy, time is something we're just not guaranteed. This has reminded us of that. The sudden passing of a loved one can leave your family in serious financial trouble when a paycheck stops coming into the family but the bills keep coming.

This is where life insurance steps in. It is the guarantee that your family will have the money they need to maintain their standard of living. A roof will still be over their head. Food will still be on the table, gas will be in the car. Utilities will be paid. Future college tuition will be provided for. A spouse will have the time to go back to school, or develop work skills without worrying about paying the bills in the meantime. Childcare (which can be just as expensive as a mortgage) will be covered. The list goes on and on.

Many people assume that life insurance is a lot more expensive than it actually is. but you'd be surprised to learn that it's more affordable than you think. Click here to learn 10 everyday items that cost more than term life insurance.

The most important thing to remember is that it's better to have some insurance than none at all. Start with where you are now, and what you can afford. You can increase your insurance coverage amount as your budget allows you to. Working with the right agent, they can set up a plan that will show you how you can work up to where you ultimately want to be. You have options.

Today, our agents are able to help you get coverage in place by phone, email, and/or video chat. These conversations may not be easy, but they're vital. If you can push through the discomfort and get these plans in place, it will give you an immense peace of mind knowing that your loved ones are protected. That makes it all worth it.

Not sure how much coverage you need? Or what type? Or where to start? That's what we're here for. We will simplify the process for you, answer all your questions, and walk you step by step to the best solution for you. Leave all the hard work to us.

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There's no better time than now to make sure that you and your family are protected.

Call Tenaya Insurance Services at (925) 322-8073 today!

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